Social Security goes digital
May 11, 2012
Workers can now access their Social Security data in just a few keystrokes thanks to a new feature on the Social Security Administration's website.
As of May 1, visitors to the site can create a My Social Security account that provides details regarding earnings and potential benefits. The online account replaces paper statements the Social Security Administration discontinued last year.
Registering for My Social Security
The My Social Security account is available to anyone age 18 or older. In order to register online, users must provide information that matches their Social Security record as well as data maintained by Experian, which is being used as an external authentication provider.
Once registered, workers can log into the account to find the following information:
- Lifetime Social Security earnings
- Estimates of retirement, disability and family benefits
- Estimated Social Security and Medicare taxes paid
- Information about Medicare and Social Security
- Points to consider for those nearing retirement age
For those unable to register for a My Social Security account, there is an option to request a paper statement. In addition, paper statements will be sent to workers once at age 25 and then annually at age 60 and in subsequent years.
Social Security statements and retirement planning
"Our new online Social Security Statement is simple, easy-to-use and provides people with estimates they can use to plan for their retirement," said Social Security Commissioner Michael J. Astrue in a statement announcing the online accounts.
While the statements can provide valuable information, workers -- particularly younger ones -- should remain aware of the limitations of the Social Security program. According to recent trustee reports, the Social Security Old-Age, Survivors and Disability Trust Funds will be exhausted sometime between 2036 and 2041.
That means workers shouldn't ignore other forms of retirement savings. In addition, they need to know the benefits listed on their Social Security statement may not be guaranteed. Future legislation or changes to the Social Security program may mean actual retirement benefits could be significantly different than the anticipated amount.
Still, the statements can provide a starting point for retirement planning. To supplement Social Security, workers should consider other savings options. Today's savings account, money market account and CD rates are generally too low to be considered appropriate for retirement savings.
Instead, 401(k) accounts and IRAs are intended specifically for retirement and have special tax benefits associated with them. In addition, many employers provide matching funds to 401(k) accounts.
The new My Social Security accounts can be a valuable tool for workers as they prepare for future expenses, but individuals should complement their anticipated Social Security benefits with personal savings to ensure they have enough money to live out their golden years in comfort.